During 1960’s Coca-Cola market share has been stagnant but the market share of Pepsi turned out to be increasing fast. Pepsi had rebrand as the brand of youth and had received well responses from the consumers. Pepsi was more popular in stores where consumers were given a choice to choose from. While in places like restaurants and clubs, consumers had limitation of decision but to drink Coca-Cola. Later on Pepsi introduced the Pepsi Challenge where the consumers were blinded to taste between Coca-Cola and Pepsi and everyone seems to prefer the taste of Pepsi to Coca-Cola.
Therefore we would expect that the demand for both Coke and Pepsi is similar. However, Coca-Cola has the lead in this industry, Coca-Cola outsells Pepsi Cola by around five to six times in the whole cola market. The two firms have had an interesting past and during the great depression from 1922 to 133 in three different occasions Coke has been offered the opportunity to buy Pepsi, but they have declined every time. However, since then there has existed a lot of competition between both kola producers. They compete by spending billions of dollars on advertising, celebrity endorsements, and slogan campaigns.
Coke and Pepsi are the two of the most influential brands of beverages in the world. These two industry leaders make up a total market share of over 70% in the carbonated soft drink arena. According to research, Coke’s market measure is over 40% while Pepsi trails at a market share of over 30%("Coke Vs. Pepsi: By The Numbers," 2014). In the beginning, Coca Cola accounted for about 80% market share, while Pepsi had a 20% market share. Both the companies have been exemplified immense longevity for decades.
Coca-Cola and Pepsi have been competitors since their creation and are in arguably the two leading companies where the selling of beverages is concerned. Both have been in many battles and have undergone multiple changes in order to catch consumer attention and make the bigger mark. Their brands have evolved through the years and have expanded to different countries and markets. When expanding, their advertisements become broad as they have to appeal to a wide consensus. They have used multiple strategies to stay in business such as endorsements, merges, and etc.
Advertisements flood our society, not one day goes by that you aren’t bombarded with different advertisements and product labels. This is now a part of our society that we can not change. Two of the biggest competitors in the soft drink industry, Coke and Pepsi, always have very powerful advertisements. Marketing companies on both sides use some strong techniques to persuade the consumer to buy one product over the other. The lesser common method is known as the copy.
The Pepsi brand manufactures many drinks like Diet Pepsi, 7UP, Mountain Dew, Lipton Ice Tea, and Miranda. The Pepsi Refresh Project was launched in the year 2009, instead of spending money for advertising during the Super Bowl series they decided to use the same money for special grants. The company decided to award grants to consumers whose ideas garnered maximum
- Motivation and Innovation for its employees. - Very strong name and brand in the market. Weaknesses: - Retailers dealing with PepsiCo do not get any discount or incentive. - Promotions always targeting the young generation. - Some package like tin pack (Cans) is not strongly available in some areas like rural
The economic factor plays an important role in any business. In 2009, there was a $90 million reduction in the net profit from the previous year that greatly affected PepsiCo. To overcome this situation, PepsiCo had to further adjust the costs as consumers were shifting to less costly drinks and snacks. There were also drop in bottled water, where there was a downward trend in the sales.
Coca-Cola's direct competitor is PepsiCo whose strength is low carbonated & energy drinks, weakness is snack foods. PepsiCo uses celebrities to attract customers. 60% of its profits come from snack foods & 40% from drinks, PepsiCo has growing profits by 15% per annum. With Coca-Cola's strength being in fizzy drinks, competitors would try to capitalize on its weaker products. Coca-Cola has recently acquired Subway soft drink business, which was previously served by Pepsi.
Coca-Cola and Pepsi are probably the two most common companies this applies to. Arguably the two most identical soft drinks on the market; these two products could not be more different. In order to gain larger shares in the beverage market, both Coke and Pepsi employed various marketing campaigns such as sports sponsorships or mass media. For example, since 1978, Coke Cola has been the official sponsor of the FIFA World Cup. By targeting arguably the most popular sport in the world, Coke has gained access to millions of soccer fans around the world, regardless of race, gender, or age (O’Brien, 2015).